Markup calculator

Markup is profit expressed as a percentage of what a product costs you. Buy a t-shirt for $8, sell it for $16, and you have applied a 100% markup — the $8 of profit equals 100% of the $8 cost. The pricing formula is price = cost × (1 + markup ÷ 100).

Retailers price with markup because it is fast to apply across a whole catalog: take the landed cost, multiply, done. The catch is that markup is not the share of revenue you keep — that is margin — and confusing the two systematically underprices products.

In “Price a product” mode, enter your unit cost and the markup you want to apply. The calculator returns the selling price, your profit per unit, and — the number most markup tools skip — the margin that markup actually leaves you.

In “Check a markup” mode you reverse it: enter your cost and an existing or competitor price, and see what markup that price represents. Everything computes instantly in your browser; nothing you type is stored or sent anywhere.

Here is the trap: a 50% markup is not a 50% margin. Mark an $8 cost up by 50% and you charge $12, keeping $4 — which is 33.3% of the price. If your business plan assumes half of every sale is gross profit but your price list was built with a 50% markup, you are 17 points short on every unit before rent and marketing take their share.

The conversion is margin = markup ÷ (100 + markup). Markups grow much faster than the margins they buy — doubling your money with a 100% markup still only yields a 50% margin. The table shows what common markups really leave you.

Thinking in margin instead? The free profit margin calculator starts from the margin you want to keep and solves the price.

Keystone pricing — a 100% markup, simply doubling your cost — is the retail default for apparel and gifts. An $8 blank t-shirt keystoned sells at $16: $8 profit per shirt and a 50% margin, enough cushion to absorb markdowns and still make money.

Now flip to check mode. If competitors sell a comparable shirt at $20, that price on your $8 cost is a 150% markup and a 60% margin — evidence you can price above keystone. Reading competitor prices as markups on your own cost is the fastest way to find money you are leaving on the table.

Conventions vary widely by industry. Apparel and accessories commonly run 100–150% markup (keystone or above), restaurants mark up ingredient cost 200–300%, packaged grocery survives on 10–40%, and contractors typically add 10–25% to materials. Slow-turning, high-touch inventory needs bigger markups than fast-moving staples.

Treat the convention as a starting point, not a ceiling: your real constraint is what the market will pay. Set the markup, look at the margin it leaves, and then confirm the sales volume that margin needs with a break-even check before committing to the price.